Download Six Essential Steps Drive Effective Energy Management

Georgia’s Manufacturing
Extension Partnership
A unit of the Enterprise Innovation Institute
Six Essential Steps Drive Effective
Energy Management
Part of a continuing series of articles for manufacturing improvement
By Mike Brown, Project Manager, Georgia Manufacturing Extension Partnership (GaMEP) at Georgia Tech
In both industrial and commercial operations, energy is a critical input that is used in numerous site-specific
applications, such as transforming raw material, operating computing and communication equipment, and providing comfort and lighting. While successful organizations always pay particular attention to their primary factors
of production, energy inputs are often overlooked because they are complicated to understand and easy to take
for granted. Taking a laissez-faire approach to the management of energy is the easy way out, but it can have
significant bottom-line consequences.
Effective energy management offers a range of advantages including reduced operating cost, mitigated environmental impact, and improved conversion efficiency. It can provide a measured operating cost advantage over
competitors and increased sustainability of operations. Although implementation requires both commitment and
investment, most companies can develop and put into practice an effective energy management plan, creating
major impacts to a company’s bottom line. By following these six essential elements of energy management, you
can help drive an effective energy management strategy in your organization:
▶ Develop a clear and consistent organizational objective
Too often, managers believe that an energy management plan consists of installing energy-efficient equipment,
pasting “turn off” stickers over light switches or having a companywide meeting to announce an energy savings
initiative. Unfortunately, these simplistic approaches lack the structure to change the culture of an organization.
To properly begin an energy management initiative, there must be a commitment from your top management,
agreement that energy is a resource worthy of attention, and consensus that improving your organization’s
energy performance will be a consistent objective for all employees.
By developing and communicating a clearly defined energy objective, you will focus efforts and offer a constant
reminder to improve. A consistent objective for energy management helps ensure a continued focus on energy
management to prevent the predictable result of many improvement programs that begin strong but weaken
and eventually expire without achieving the desired result.
▶ Use existing energy data
One aspect of energy that makes it amenable to improved management is the wealth of useful data available
from utility bills and other sources that are easy to access. Peter Drucker, a renowned management guru,
famously said, “You can’t manage what you can’t measure.” By simply understanding the details behind your
energy bills and knowing how to ask the right questions, you can get the measurements you need to track
performance, identify cost saving opportunities, or quantify savings. Here are two examples of how information
from energy bills can help create an immediate impact:
•
Electrical bills provide the monthly cost but also detail monthly electrical consumption, peak demand, site
power factor and energy and non-energy cost adders. With a little manipulation, you can calculate electrical
load factor, average electrical cost and marginal costs of demand and energy. By contacting your electric
Six Essential Steps Drive Effective
Energy Management
Page 1 of 4
August 2012
www.gamep.org
Georgia’s Manufacturing
Extension Partnership
A unit of the Enterprise Innovation Institute
utility, you can acquire interval demand data, which will show the peak demand for each measurement
period during the year. Georgia Power, for example, collects information in 30-minute demand intervals,
which means you can get 17,520 yearly data points. Analyzing this information provides insight into how
demand varies month-by-month, week-by-week and hour-by-hour, allowing you to develop a strategy to
reduce cost by cutting peak demand.
•
Natural gas bills show consumption in cubic feet, commodity cost, transportation cost and demand measured in dedicated degree days of consumption (DDDC). Combining energy data with output, production or
occupied space numbers allows you to create an energy performance indicator, which can be used to track
improvement or benchmark against similar facilities, yielding significant cost savings opportunities.
▶ Employ a team-based approach
Purchase, use and maintenance activities related to energy are usually spread across multiple departments
or groups within your organization; so limiting energy management responsibility to a single individual or
department may reduce the impact of an energy management plan. Instituting a team-based approach with
multi-functional representation is the only effective method to bring the diverse elements together and create a
workable environment for energy management improvement across the organization. Selection of appropriate
personnel for an energy management team is essential to initiating and sustaining the effectiveness of your
efforts.
▶ Consistently operate and maintain existing equipment
There is a common perception that purchasing new energy-efficient equipment is the best option to reduce energy costs and improve energy performance. This approach, however, overlooks an essential element of energy
management: the requirement to properly operate and maintain energy consuming equipment, systems and
processes. If you cannot effectively operate and maintain your existing equipment, how can you be expected to
do the same for new, more complex energy-efficient systems?
To substantiate the importance of proper operation and maintenance, Texas A&M University tracked the performance of newly installed energy-efficient equipment in selected state buildings over a period of several years.
The researchers found that energy-efficient retrofits lost approximately 60 percent of their projected savings
within five years of their installation due to poor operation and maintenance practices. This study illustrates the
importance of correct operation and maintenance to maximize efficiency and decrease the cost of operation.
Determining appropriate operating and maintenance practices for your current energy systems is an effective
way to reduce operating cost without significant capital investment.
▶ Formulate achievable action plans for improving energy performance
The urge to embrace grandiose improvement plans is great given the societal pressures for reduced environmental impact, greater use of renewable energy and favorability of increased sustainability. Instead of pursuing
appealing, high risk options, however, a more prudent approach would be to identify and implement energy
management projects that align with an organization’s energy management objectives.
By selecting projects that match defined objectives, you will help meet specified internal energy saving, cost
avoidance, capital investment, and economic return requirements. Although not as visible as most renewable
energy projects, regular maintenance such as air filter replacement and synthetic lubrication substitution and
Six Essential Steps Drive Effective
Energy Management
Page 2 of 4
August 2012
www.gamep.org
Georgia’s Manufacturing
Extension Partnership
A unit of the Enterprise Innovation Institute
the optimization of system operating conditions constitute simple actions that yield significant energy savings.
Though simple, they are difficult to sustain without a carefully defined action plan.
▶ Monitor results and adjust plans accordingly
The only way to determine if your energy management plan is working is to develop and track energy performance indicators. Properly defined performance indicators adjust for changes in ambient conditions, production rate, operating hours and other relevant variables to yield an accurate representation of your site energy
efficiency. If the performance indicators show improvement, your energy management plan is working and
should be continued. If the indicators show no improvement or a decline in performance, the reasons must be
analyzed, the cause identified and appropriate corrections implemented.
Using available energy data to determine energy performance and guide development of a management plan
is essential to ensuring that organizational objectives are being met and facility resources are being optimized.
Organizations often have a wealth of energy data that is often not being utilized to monitor energy performance.
By following a systematic approach to applying the proper elements of energy management, you can create an
effective, sustainable energy program.
▶ Contact
For more information on implementing ISO 50001*, the new international standard for energy management
systems, and changing the way your organization uses and manages energy, and turning this savings into
sustainable gains, contact Bill Meffert at [email protected].
Beyond ISO 50001, Georgia Tech can assist you in achieving the Department of Energy’s (DoE) Superior Energy
Performance (SEP) Certification. The SEP program was formulated to provide certification of a facility’s actual
energy savings in addition to implementing ISO 50001. SEP offers three levels of certification depending on
demonstrated energy savings during a three year period:
•
Silver: over 5% energy savings from baseline
•
Gold: over 10% energy savings from baseline
•
Platinum: over 15% energy savings from baseline.
Georgia Tech can provide training, coaching and guidance to help your plant achieve Superior Energy Performance Certification.
*Georgia Tech’s Energy and Sustainability Services group authored the first national energy management system
standard, ANSI/MSE 2000, and participated in the international committee that drafted ISO 50001. Through
Georgia Tech’s Professional Education, you can access ISO 50001 training courses including:
•
Introduction to ISO 50001
•
ISO 50001 Implementation: Phase 1 Planning
•
ISO 50001 Implementation: Phase 2 Doing
•
ISO 50001 Implementation: Phase 3 Check and Act
•
ISO 50001 Lead Auditor
Six Essential Steps Drive Effective
Energy Management
Page 3 of 4
August 2012
www.gamep.org
Georgia’s Manufacturing
Extension Partnership
A unit of the Enterprise Innovation Institute
▶ About GaMEP
The Georgia Manufacturing Extension Partnership (GaMEP) is a program of Georgia Tech’s Enterprise Innovation
Institute and is a member of the national MEP network supported by the National Institute of Standards and Technology (NIST). The GaMEP, with offices in nine regions across the state, has been serving Georgia manufacturers
since 1960. With a broad range of industrial expertise, the GaMEP helps manufacturing companies across Georgia
grow and stay competitive. It offers a solution-based approach through technical assistance, coaching, education,
and connections to Georgia Tech, industry and state resources designed to increase top line growth and reduce
bottom line cost.
Six Essential Steps Drive Effective
Energy Management
Page 4 of 4
August 2012
www.gamep.org